The Novopolotsk branch of the Druzhba oil pipeline is technically ready to restart oil transit to Lithuania at any moment, a source in the company told Interfax. A request to resume transit is needed before crude can flow again, Interfax said.
Our view: Though it seems that there is still a hope that the supply through the section will be resumed, we would wait until the final answer from Kreml. In case of the pipeline restart, we see some upside to our valuation since we were calculating with seaport supply of Mazeikiu Nafta and lower utilization rate. We see the news as slightly positive.